What steps will reproduce the problem?
1. Following "Option 2: iPhone Custom SDK" instructions from Install.rtf
2. Compiling my app

What is the expected output? What do you see instead?
I expect it to compile without problems, but I get errors compiling my .pch:
/var/folders/v4/v4AaWy49Ef0TtV+AQWo43E+++TI/-Caches-/com.apple.Xcode.501/CompositeSDKs/iphonesimulator-iPhoneSimulator3.0-edpwbswnurbobahkcymopzorbvet/System/Library/Frameworks/UIKit.framework/Headers/UILocalizedIndexedCollation.h:13:
error: syntax error before 'AT_NAME' token
/var/folders/v4/v4AaWy49Ef0TtV+AQWo43E+++TI/-Caches-/com.apple.Xcode.501/CompositeSDKs/iphonesimulator-iPhoneSimulator3.0-edpwbswnurbobahkcymopzorbvet/System/Library/Frameworks/UIKit.framework/Headers/UILocalizedIndexedCollation.h:21:
error: syntax error before '}' token
/var/folders/v4/v4AaWy49Ef0TtV+AQWo43E+++TI/-Caches-/com.apple.Xcode.501/CompositeSDKs/iphonesimulator-iPhoneSimulator3.0-edpwbswnurbobahkcymopzorbvet/System/Library/Frameworks/UIKit.framework/Headers/UILocalizedIndexedCollation.h:23:
fatal error: method definition not in @implementation context

What version of the product are you using? On what operating system?
Mac OS X 10.5.7, iPhone OS 3.0, Xcode 3.1.3, all the newest release builds
as of this writing.

Please provide any additional information below.
I fixed this problem by setting my GCC version to 4.2.  I don't know why,
but adding the "Additional SDKs" setting made my project compile with 4.0
instead of 4.2.  This is the only setting out of all of those from the
instructions that causes the problem.  Perhaps you could add this
information to Install.rtf for future users.